The next morning, he met with the six employees he was letting go. Afterward, he clicked the button to publish his post about the “extremely sad day for all of us who have to say goodbye to a group of great people.”
“Our whole company is built on the idea of transparency in investing, so that was a reason why it was important for us to do it,” Mr. Carpenter said in an interview. He also wanted employees and outsiders to know they were each getting the same version of the story. “It let them know what we were up to in real time, so they didn’t get nervous about what was going on,” he said.
Some founders worry that employees will use their company’s own Web 2.0 technology to turn against the boss. When Loïc Le Meur, founder of the video blogging site Seesmic, laid off one-third of his staff on Oct. 10, the first thing he did was publish a post and video on his company site. Otherwise, he said, videos and posts criticizing him would have shown up all over the Web, including on Seesmic.
“I was not seeking P.R.,” he said. “I just knew I would have bad P.R. otherwise.” His emotional announcement drew 66 comments, almost all of them supportive.
Some companies that have skipped the layoff post have suffered. After Jive Software cut 20 percent of its staff, one of the terminated employees, Chris Kalani, called it an “all out massacre” on his personal blog and said he had been forced to leave behind his things, including his wedding photo. Tech blogs immediately picked up the story.
Jive, of Portland, Ore., was left scrambling to react. Sam Lawrence, the chief marketing officer, left a short message on Twitter: “Folks, Jive did make a cost reduction today. Nowhere near as dramatic as what I’m reading on Twitter and Techcrunch.”
Mr. Kalani updated his blog after the company called and said he could get his possessions. Still, the negative tone had been set. “From your description of events, it’s clear that the positive Jive work environment was the first thing to go,” one commenter wrote on Mr. Kalani’s blog.
Mr. Lawrence said Jive, which has a company blog, did not blog about the layoffs “out of respect for the people involved.”
But Mr. Kalani said he wished Jive had published its own post. “They had to run and clean up the mess, but it was kind of their fault for not writing about it themselves,” he said. “There was no grace or anything.”
Companies that have blogged about their layoffs have found a sympathetic audience. Start-ups with job openings called ex-employees of Cake after Mr. Carpenter blogged about their layoffs. Glenn Kelman, chief executive of real estate site Redfin, expected the public to turn against him after he wrote about Redfin’s layoffs. Instead, 74 readers left supportive comments on the blog. “It’s been part of the healing process,” Mr. Kelman said.
The demand for transparency has forced small start-ups to act like public companies, he said. At the same time, “it makes private companies much more accountable to the people they retain and who leave, and that’s probably a good thing,” Mr. Kelman said.
Larger companies need to learn that lesson, too, said Andy Sernovitz, chief executive of the Blog Council, which helps big companies use social media. “There are hold-out companies that still wish there was traditional P.R. control of the message, but that day is long over.”